Electronic Arts: LARRY PROBST/Redwood City, Calif.

LARRY PROBST/Redwood City, Calif.

Here's one way to beat the tech-slump blues: employ a suave secret agent, a teenage wizard and a handful of hobbits. That was the strategy of Larry Probst, CEO of video-games giant Electronic Arts, based in Redwood City, Calif. As each new generation of console hardware makes video games look more like movies, Probst wanted to snap up franchises with repeated success at the multiplex--like James Bond, Harry Potter and The Lord of the Rings--and put them to work in the virtual arena.

The plan paid off. The Harry Potter games alone have sold more than 20 million units worldwide. After...